Pharmaceutical Industry Analysis
A. Introduction
Pfizer, US pharmaceutical company is one of the largest pharmaceutical companies in the world. Unfortunately, Pfizer faced challenges by macro-environment forces that affect their sales volume decline dramatically in 2011. PESTEL, Porter’s Five Forces and Industry Lift Cycle frameworks to be applied to analysis the broad macro-environment that affected Pfizer in the pharmaceutical industry.
1. PESTEL framework
PESTEL (Appendix I) is classifies into six environmental influences including Political, Economic, Social & Cultural, Technological, Environmental and Legal.
i) Political * The promotion of pharmaceuticals products in US and patent protection period were direct governed by Food and Drug Administration (FDA). Whereas, self-regulation practiced in New Zealand, UK and Australia are under self-governed by Pharmaceutical Advertising Advisory Board (PAAB) in Canada. Lack of regulatory supervision by PAAB may lead to mis-prescribe to the patients. * The pressure groups of patients and ageing populations (over 65s) on the healthcare systems. They are lacked of medical insurance and unaffordable to the expensive drugs such as cancer medicines. Subsidization on cancer medicines is strongly demanded. * The Government’s focus on reducing the healthcare expenditure because the healthcare and medical system were unable to share the benefits to the pressure groups. * The community groups protest against over safety alerts for drugs and oppose strongly in drug price differentials with other countries. FDA delegated the Institute of Medicine (IOM) to inspect the drug safety and proclaimed 15 safety drugs alerts or revokes for safety reasons. Further, FDA authorized Risk Evaluation and Mitigation Strategies (REMS) to keep track and assure drug safety.
ii) Economic * Pharmaceutical sales growth is tightly related to the growth of GDP. Economic decline due to GDP per capital drop in the country and caused
Pfizer, US pharmaceutical company is one of the largest pharmaceutical companies in the world. Unfortunately, Pfizer faced challenges by macro-environment forces that affect their sales volume decline dramatically in 2011. PESTEL, Porter’s Five Forces and Industry Lift Cycle frameworks to be applied to analysis the broad macro-environment that affected Pfizer in the pharmaceutical industry.
1. PESTEL framework
PESTEL (Appendix I) is classifies into six environmental influences including Political, Economic, Social & Cultural, Technological, Environmental and Legal.
i) Political * The promotion of pharmaceuticals products in US and patent protection period were direct governed by Food and Drug Administration (FDA). Whereas, self-regulation practiced in New Zealand, UK and Australia are under self-governed by Pharmaceutical Advertising Advisory Board (PAAB) in Canada. Lack of regulatory supervision by PAAB may lead to mis-prescribe to the patients. * The pressure groups of patients and ageing populations (over 65s) on the healthcare systems. They are lacked of medical insurance and unaffordable to the expensive drugs such as cancer medicines. Subsidization on cancer medicines is strongly demanded. * The Government’s focus on reducing the healthcare expenditure because the healthcare and medical system were unable to share the benefits to the pressure groups. * The community groups protest against over safety alerts for drugs and oppose strongly in drug price differentials with other countries. FDA delegated the Institute of Medicine (IOM) to inspect the drug safety and proclaimed 15 safety drugs alerts or revokes for safety reasons. Further, FDA authorized Risk Evaluation and Mitigation Strategies (REMS) to keep track and assure drug safety.
ii) Economic * Pharmaceutical sales growth is tightly related to the growth of GDP. Economic decline due to GDP per capital drop in the country and caused